Delhi High Court
M/S Mesco Pharmaceuticals Ltd. & ... vs R.K.Rawal & Ors. on 7 November, 2013
Author: Sunil Gaur
* IN THE HIGH COURT OF DELHI AT NEW DELHI
Judgment Reserved on: October 23, 2013
Judgment Pronounced on: November07, 2013
+ CRL.M.C. No.5063/2006
M/S. MESCO PHARMACEUTICALS LTD. ORS. ...Petitioner
Through: Mr. R.K.Handoo and Mr.
Yogesh Sharma, Advocates
Versus
R.K. RAWAL & ORS. .....Respondents
Through: Mr. Sachin Datta, Central
Government Standing Counsel
CORAM:
HON'BLE MR. JUSTICE SUNIL GAUR
% JUDGMENT
1. In a complaint (Annexure P-1) under Section 56 of The Foreign
Exchange Regulation Act, 1973 (hereinafter referred to as FERA) read
with Sub-section (3) & (4) of Section 49 of The Foreign Exchange
Management Act, 1999, petitioner-company and its four Directors have
been summoned as accused by trial court vide order of 28 th May, 2012
(Annexure P-2).
2. In this petition, quashing of aforesaid criminal complaint
(Annexure P-1), impugned order (Annexure P-2) and Opportunity Notice
of 13th March, 2002 is sought on merits.
3. At the hearing, learned counsel for petitioners had placed reliance
upon decisions in R.C.Gupta & Ors. v. State & Anr. 2008 [1] JCC 684;
Central Bank of India vs. M/s. Asian Global Ltd. & Ors. JT 2010 (7) SC
88; National Small Industries Corporation Ltd. Vs. Harmeet Singh
Paintal & Anr. JT 2010 (2) SC 161; Arun Sood Vs. P. K. Roy 2012 [3]
JCC 2107; Subhankar Biswas Vs. Sandeep Meta 2011 (267) E.L.T 433
(S.C.); M/s. Rare Creations Ltd. & Ors. Vs. Union of India & Anr. 2010
[1] JCC 456 and Devashis Bharracharya Vs. Union of India 159 (2009)
DLT 780 to raise three contentions which are as follow: -
(i) That no opportunity notice as contemplated under section 61
(ii) of the FERA, 1973 was given to the petitioners before
filing of the complaint under section 56 of the FERA.
(ii) That relied upon documents were not furnished to the
petitioners before filing of the complaint under section 56 of
the FERA;
(iii) Role of each of the individual accused Directors is not
specified in the complaint.
4. To resist this petition, learned Central Government Standing
Counsel on behalf of respondents had placed reliance upon decisions in
The Assistant Director, Enforcement Directorate, Government of India
Vs. Khader Sulaiman, P. Krishnasamy and J. Sampath Kumar, 2003 Cri.
L.J. 3468; A S G Jothimani Nadar Vs. Deputy Director, Enforcement
Directorate 1984 Law Suit(Mad) 47 decided on 24.02.1984; LPA
No.405/2009 J.K.Singh, Director, M/s. Mesco Pharmaceuticals Ltd. Vs.
UOI & Ors. decided on 08th September 2009; N. Rangachari Vs. Bharat
Sanchar Nigam Limited JT 2007 (6) SC 292 and Standard Chartered
Bank & Ors. Vs. Directorate of Enforcement & Ors., (2006) 4 SCC 278
and had asserted that the contentions of petitioners are untenable because
notice under Section 51 of FERA served upon petitioners constitutes a
valid notice for the purpose of proviso to Section 61 (2) of FERA.
5. It was maintained on behalf of respondents that in the complaint
(Annexure P-1) in question, specific role has been attributed to petitioners
and attention of this Court was drawn to paragraph No.2 (vii) & (viii) of
the complaint (Annexure P-1). It was disputed on behalf of respondents
that documents relied upon in the complaint were not served upon
petitioners. Lastly, it was maintained on behalf of respondents that the
contentions raised in this petition are triable issues, which cannot be
determined at the threshold in exercise of inherent jurisdiction under
Section 482 of Cr.P.C. Thus, dismissal of this petition is sought.
6. During the course of hearing, learned counsel for petitioners had
referred to Government Circular (Annexure P-8) and had pointed out that
the alleged contravention is of not more than sixty seven lakhs rupees and
as per aforesaid Circular, the contravention of two crores rupees or above
attracts the provisions of FERA, under which petitioners are being
prosecuted.
7. Upon hearing and on perusal of the impugned complaint, the
material on record and the decisions cited, I find that respondents
maintain in their counter affidavit that Opportunity Notices in terms of
Section 67 of FERA were issued to petitioners and the documents relied
upon in the complaint in question were supplied to petitioners. However,
petitioners dispute it. This raises a triable issue which is required to be
determined at trial.
8. The stand of petitioners that there was no intentional or wilful
default on their part also raises a triable issue which cannot be determined
while exercising inherent jurisdiction of this Court under Section 482 of
Cr.P.C. and that too, at the threshold of these proceedings.
9. Regarding the role of petitioners, the averments made in paragraph
No. 2 (vii) & (viii) of the complaint in question prima facie justify
continuance of proceedings arising out of this complaint. So far as the
applicability of Circular (Annexure P-8) is concerned, I find that the
alleged contravention is of the year 1995-96 and Circular (Annexure P-8)
is of 5th July, 2001 and at the hearing, it was not shown by petitioners'
counsel that Circular (Annexure P-8) can be made to operate
retrospectively. Pertinently, prosecution of petitioners in the instant
Complaint (Annexure P-8) is for contravention of substantive provisions
of this enactment i.e. Section 14, 16 & 18 (3) of FERA read with Central
Government's Notification No. F-1/67/EC/73-1 & 3 both of 1st January,
1974. So, this question as well as the question of vicarious liability is left
open to be considered at the stage of framing of charge/Notice under
Section 251 of Cr.P.C., as the case may be.
10. In light of the aforesaid, this petition is disposed of with liberty to
petitioners to urge the pleas taken in this petition on the afore-noted
limited extent before the trial court at the stage of framing of
charge/Notice, while not commenting upon the merits, lest it may
prejudice either side.
(SUNIL GAUR)
Judge
NOVEMBER 07, 2013
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